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Taiwan’s Free Ride on U.S. Defense

This article appeared in the Asian Wall Street Journal on April 23, 2007.

The Taiwan legislature’s reluctance to pass a “special defense budget” to pay for U.S. weapons systems looks set to continue as the island’s presidential campaign heats up. That leaves America in the unenviable position of having an implicit commitment to defend a fellow democracy that doesn’t seem especially interested in defending itself.

This conundrum is the culmination of years of partisan bickering between President Chen Shui-bian’s Democratic Progressive Party and the Pan Blue coalition, composed of the Kuomintang Party and People First Party. While Mr. Chen supports better defenses, the Pan Blues — who control the legislature — argue that the expenditure is excessive, diverts needed funds from domestic priorities, and could encourage Mr. Chen’s administration to exacerbate tensions across the Taiwan Strait.

Though Mr. Chen’s administration has repeatedly scaled back the deal, reducing it in stages to a mere $10.3 billion, from $18.5 billion, prospects for its passage have barely budged. So far, the Pan Blue coalition has blocked a vote on the measure more than 60 times. It took until December of last year for the majority to agree even to send the proposal for consideration in the budgetary committee. U.S. President George Bush grew so disgusted with Taipei’s behavior last month that he personally overruled a Pentagon arms proposal for the island unless and until the special defense budget is approved.

A very disturbing dynamic is developing in Taiwan. On the one hand, Mr. Chen’s government seems determined to consolidate Taiwan’s separate political status — even if that means taking measures Beijing regards as highly provocative. The latest incidents include, for instance, Taipei’s decision to rename various state corporations to substitute “Taiwan” for “China.” Yet even as Taipei adopts ever more assertive policies toward the mainland, it underinvests in defense. Its spending on essential matters like procurement, operations, training, and personnel has shrunk, in real terms, by more than 50% since 1993, and continues to contract at an alarming rate. Taiwan’s regular defense budget has plunged to an anemic 2.2% of its annual GDP.

From America’s standpoint, Taiwan’s political leaders are creating the worst possible combination: the DPP’s provocative cross-straits policy with the KMT’s irresponsible policy on defense spending. That is a blueprint for trouble. China has already deployed nearly 1,000 ballistic missiles across the Taiwan Strait, and Beijing’s military modernization program appears heavily oriented toward credibly threatening military action against Taiwan. A bold cross-straits policy, coupled with inadequate defense spending, virtually invites a Chinese challenge.

The U.S. would probably try to rescue Taiwan if Beijing launched a military assault. Yet, given the ongoing erosion of Taiwan’s defense capabilities, within a few years it will be not at all certain that the island could even stave off an attack until U.S. forces arrived. It is dubious enough for the U.S. to risk war with an emerging great power like China to defend a small client state of comparably modest strategic and economic significance. It is even worse to incur such risks on behalf of a client state that is not willing to make a meaningful defense effort.

America is in an unrewarding and potentially dangerous position. Washington must make it clear to all political players in Taiwan, especially the Pan Blue leaders, that free riding on America’s military might cannot continue.